Hello. Welcome back. 20 minute, Veasey. I'm your host, Harry Stabbings as H Stabbings on snapshot and say Show we bring you part one with Part two being on Friday of a special feature on L. A. Is incredible tech ecosystem on, So joining me for the show say we have great best Cinelli. Now Greg is a partner at one of L. A's leading funds upfront Ventures on At Upfront. Greg specializes in businesses at the intersection of retail and technology. Pride upfront. Greg was the CMO toad Look. A leading online fashion retailer that specialized in flash sales there, was acquired by Nordstrom for $270 million. Before old look,

Greg was executive vice president of business Development and Siachin Live Nation on Before Live Nation. Greg held a number of leadership positions at eBay and StubHub and was business leader who led eBay's acquisition of StubHub in 2007. I also have to say a big thanks to the main man, Mr Marks Schuster for making the Inter to Greg today, without which the interview wouldn't have happened. But before we dive into the show's day, how could we do in L. A feature week without a feature from We Are L. A Tech On My Good Friend Esprit, who runs the show. We are L. A Tech is the number one resource uniting the L a start up community offering a unique combination of curated offline experiences. The number one l a tack port cost could We are late tech on the only mobile app that keeps you in the know with a full calendar of events, so make sure you go to we are l. A tack dot com forward slash v c to explore and learn all about everything l. A.

Tech and Silicon Beach. You'll also get access to a private L A Tech immersion. Cool exclusively for 20 minute BC listeners again, that's we are l a tech dot com four slash v c It really is a must check out. But if you're going to enjoy L. A to the max, then you really have to be well rested. And that's why IV comes in even the makers of that great mattress to give you the perfect sleep. With three led technology and next generation memory foam, it comes packaged in a beautiful box on arrives the day after you order it. They also offer you 100 night free troll so you can ensure that it's the perfect bad for you with free return pickup. So what's the risk? Go to eve mattress dot co dot UK onto the promo code 20 V c and you'll get an incredible £50 off. And it will be with you the next day. How that it's now time to hand over to the main man, Greg Best Nellie partner at Upfront Ventures.

You have now arrived at your destination. Greg. Welcome to the 20 minute we see a big hand tomorrow, Finch shootings today. But it's so great to have you on the show. Thank you for

joining me. Oh, yeah, I'm excited. It's great to be with you. Congrats on all your success. So I'm glad to be number 497 on the list.

Have hunted gets tell us it today. Wait a bit about you and how you came to be a partner and up front. So how did you come to be in this position?

Yeah, I have a pretty unconventional track record to be in venture capital. I think two things I'm most proud of. I'm pretty sure I'm the Onley current or former chief marketing officer who was also an investor, and I know I'm the only person ever used to work in a horse racing track on, so I have a very different way that I got here, and it actually drives a lot of my decision making and the type of entrepreneurs I I look to support. But the real story is I moved down here back into Los Angeles in 2008 after spending a lot of time at eBay up in the Bay Area, and eventually became the chief marketing officer at a business called Hope Book, which is a fashion e commerce business that we sold very successfully to Nordstrom in 2011. And the truth is, I was only a couple of years into my vesting schedule when that acquisition. And so I continue to work at Nordstrom but also have done pretty well through the exit. Andi started doing some angel investing in Southern California companies in Kinley National Companies. I was a co founder of an accelerator here in Los Angeles called Mucker Lab, with a couple of fellow eBay colleagues that it worked with and really spent time getting to know what was going on here in Los Angeles was. I'm sure we'll talk about later.

And during that process, really 2013 or so, I got to know the was in GRP Partners, which is now upfront ventures, Mark, sister and other partners here and really got excited about the idea of being part of of the L A story, and I Then I coined the phrase long L A, which I still use. And if you see on Twitter and things that kind of all came from some original ideas of beaches being very bullish on what was going on in Los Angeles, and I thought Venture was a pretty exciting place to be with everything happening and upfront happen to have an opportunity. We've spent a lot of time together, and I've been here for last 2.5 years or so,

And as you said, unorthodox, start there. So I have. So I have to ask what you think that unorthodox start gave you in terms of the fact in your decision making processes in

a master? Yeah, so I really the term I use is is grit or moxie. I think those are two terms that I really look for in on spinners because I think I was always that I grew up in a small town. I was supposed to be a dairyman or much more of a different type, but I didn't. I thought veces were the Vietcong. I didn't know what. I didn't know what adventure Capitals was till I was, you know, an eBay when I was 32. I think on DSO I just kind of really look at those entrepreneurs that have built great companies. Obviously, there's a lot of people who went to Harvard and Yale and Stanford, but I think really the interesting ones or the ones that I think wise like Toe Salo and spend time with have a different kind of element. They had some don't say that hardship, but they overcame something.

They were underdog. They really took advantage, and you'll hear me saying it's a lot of their own unfair advantage, and I kind of think that we're the type of firm. Actually, that Mark, sister and other partners have similar backgrounds. Is that really respond to those type of entrepreneurs those people who noticed something, noticed an opportunity and really try and parlay that into a large business success. And so I tend to have filters around those type of entrepreneurs versus what I call Moore of the Silver Spoon entrepreneurs. Again, I don't want to discredit anyone, but, you know, I think people who kind of work through gotten themselves into positions concede probably have a greater likelihood of having a very successful outcome. So those were some character to said,

Look for on is that great? Always kind of inherently obvious? Or how do you to expose that in the initial meetings?

Well, I think you can really talk about. There are things that I try. I have filters that I put on, you know, things like name droppers, those triple who over at over exaggerates their titles and the work they've done. You know, when a 23 year old tells me that they they ran $100 million budget for Pepsi Cola or something, I just find that very hard to believe and saying a lot of people trying over sell themselves. You can also drive it around when people really give credit to their other team members or credits to their bosses for that, putting them in positions to succeed. They're just some elements of what people say in how they say it, as well as how they define the market opportunity going after. You know, those people who really pitch a $1 trillion market or something like that versus having realistic expectations about the products of service they can offer. I kind of use those and then,

you know, back that I use the term unfair advantage, like, what is this person of this team? What's their unique advantage? They have to conquer and develop a market. And so I kind of tie all those together.

You very sure if you found her assessment and you're investing thesis now, having been the message for 3 3.5 years, how's that changed that over the years when you started out? How did you look, Teoh go about kind of investment? Thesis creation?

Yeah, I think a lot of it. I think. At the beginning I had some general market faces about retail innovation and some consumer products categories. What I quickly learn is I'm much better off reacting to strong nuts burners who I think they could do something with the market versus my own point of view about a certain market, something Levin is kind of that was a big early driver for the types of companies are looking and entrepreneurs I was seeking out. Now I said, much more reactive to just responding to quality people with quality ideas versus be saying, Hey, I want to do live events virtual reality. For example. Instead of trying to find the company in that space, I'm more likely await to find a great out. Sure who presents an idea like that to me?

Is that what would you say? The investor specialization isn't necessarily look the optimal strategy

to go for. Yeah, Look, I don't I think it depends, I think for me, definitely not. But in general, I think the reality is I would I would take a great team in a very good market, over a decent team in a great market. I think at the end of day, the great end of the day, the great team has a flexibility inside to really move into great markets on DSO. I think if you narrowly say ham looking for a company that fits X, Y and Z. You may force yourself into a decision just because it was the only thing you found. It might settle for an investment. And I don't think you can never settle for investments in venture

capital on one of the many areas within your wisdom and expertise is the retail and technology space. The keyword that that I want to touch on is kind of the intersection that we have between retail and technology today on. I want to know if you agree with Jeff Gordon and reason when he said that was seen Structural shift from digital to retail Do you think we fundamentally are seeing this shift?

Yeah, so I think it's kind of interesting questions, So I used to work for Jeff it. EBay on actually now serve on a board with him, a company called Walker and Company. Then Andresen led around after we had done a deal with a much broader uninterested Walker S. I think I don't disagree with his macro. Thesis is I think there's a little too much The sky is falling. Samat seem to that. The reality is, I would say, businesses and categories evolves over time in retail isn't any different. You're you're not in the US but, you know, if you grew up around here, you will hear your parents, your grandparents talking about brands like War,

Sir Montgomery Ward or Sears or Kmart or even Circuit City. All those retailers are no longer in business and had absolutely nothing to do with Amazon, right? So the reality is, I think there's more of a consumer characteristic change going on that's being accelerated by technology. Clearly, Barnes and nobles is out of business because of Amazon, and Blockbuster is out of business because of Netflix. That was more because the content itself had transitioned from a tangible product to a digital one, I would say, but I look at Maurin retail as an example. The most successful retailers today in the United States have very little e commerce. So think of Home Depot, Lowe's, TJ Maxx, Costco Dollar stores are A H and M even unit clo their e commerce businesses,

air sub 3% of total sales. Yet TJX, which owns company called TJ Max and Marshals, has a $50 billion market cap, and they do zero online, right, so I think it it's really towards a bigger macro shift. What's really happened, I believe, is consumers are shifting to Christ value convenience providers in away from. That's why you see North from racks business actually being a better business than Nordstrom's business. That's why you see H and M Zara's businesses be better than same Macy's business or gaps. Business is, I think you're just seeing a shift of the customer value. Think of Costco. Think of places like that,

s so I think that's amore, a broader shift. And then you do have what I call the urbanization of the consumer. Not necessarily just from a geography perspective where people are moving into cities, which is obviously slightly true. But the malls aren't as cool as they used to be. The very commoditized shopping experiences aren't well received by consumers anymore, so I think those are all adding to really the change. And clearly technology plays a part but isn't the only thing that's driving. You know, Macy's toe have a poor sales quarter

and you talk about kind of value and convenience that being crucial to conceive it with the lights of, say, a will be Parker get together that lack of retail stores, and then they have one or two. Now I have 20. Yeah, I get bad example, but you get what I mean that online brands, meaning they can pass the cost onto. Today they pass the savings on to consumers. Knobler PRICING Does this mean you'll see an end to the physical High Street?

Do you think? No, because I think curation is important. I think the reality is not all brands can afford to distribute product directly at scale to their customers. I believe that similar. That's like wine. Fashion needs someone to tell us what looks good on, Baby. It's not going to be so much the department store anymore, but might be an influence or something else. But I do think those aggregator brands and styles are important. That's why liquor stores exists to tell us which are the 50 wines we can choose from. I think Nordstroms role is no different and that certain styles and types of products that we've been interested in so I think it will definitely change that you're already seeing things like private label brands and other things really to drive margin in the stores changing, and the reality is we talked earlier. There are just very different types of customers Now. You have the high end customers think of, like the Barneys of the world markets of the world.

I put I put everything into the world into it. The department store to kind, identify different customer traits in the middle. You have like a Macy's in a North German on the lower end, you might have a pennies or coals on, and they all serve different person, different purposes to different markets.

I'm with this kind of very physical retail discussion. I'm not here. Will you take ways? Were them from your time with Nordstrom and not our position? What did you learn about the kind of conceivable?

Yeah, so I learned a tremendous about as much about the consumer themselves, but I learned a lot about brand loyalty. There's always there's always great stories about Nordstrom. How they were had the best return policy anywhere on that you could return shoes that were worn for three years and bring them back and get your money back. And a lot of the stuff that was actually was mostly folklore where they didn't actually do everything they said, but the perception that Brandon was that of great customer service and the importance of that and the value that to the company I really underestimated. So just that the urn, customer loyalty and really with lifetime value literally means, as in my mother shops that has shopped and Nordstrom from 50 years or 40 years. So I think that was important. Scale was another thing I learned. I mean, when I was at Outlook, you know, we would do. We got to a point where doing,

say, $25 million a month of sales Before I left on, we had started. We were doing a 1,000,000 a month, so we had huge growth. But North terms of doing $10 billion a year, right? And just the sheer enormity of having a store's business on online business. And then they acquired businesses like Hope Look, So just this. The understanding of what it takes an organization to truly scale think stuff in boxes is very different and say my eBay or step updated for a marketplace business, you really never saw what you're selling. But Nordstrom, you saw everything that you were selling this is sure magnitude of the products being dinner that was pretty impressive.

On degree, recent guest of mine said that with the new millennial generation, there's a lack of brand loyalty. Jo grew this sword using that is potentially

even more. I think there's actually even more. I think it's more of a changing customer and say, I don't like to use a term millennial because I think we're all changing the way that we buy on Technology is really driving that. But look at look at using the Chipotle example here in the US There was a brand incredibly loved, but then incredibly hated within a very short period of time because of a quote unquote betrayal of betrayal of trust around the products and that they were selling. In this case, it was the food they were serving. Something brand are you know, consumers today are very receptive to think of Apple. Think of Lululemon. Think of those types of brands where they have incredible loyalty. I think there may be an appetite to discover more than in the past. Maybe I can find that new artists find that new fashion brand find that new type of food. But in general, I think when you do find brands that you love today's customer, we'll continue to migrate more and more to them on DSO again. I think it's there's definitely maybe the outcome is more winners. They really notice, and there's less of a middle tier. But I do think brand and brand development isn't is more important now because it just enables you to differentiate and very crowded market cause your ability for anyone to launch the brands is much easier now than it was ever before.

Is brand enough of I P for you guys to invest? Is that in a very meaningful, tangible ownership stake? The sign has over someone else?

Yeah, I would say it's one of a handful. I think if you look a expensive like direct to consumer type of brands, I think we my formula is a very large market opportunity that doesn't have multiple brand participants that can play. And that's a high margin categories that have re occurring. Purchasing character six. Meeting This idea of Aiken build a direct to consumer brand in categories that have this, but the most important part of it all is you have a founder for a team has some sort of unfair advantage and perspective in that category. And brand development might be one of those. I think we'll talk. I think a brand like Dollar Shave Club is an example of that where, you know, you wouldn't think that brand could be developed in and around something owned by Procter Gamble via Gillette. But I think through some innovation, through a founder with a unique perspective, they're able to separate through the clutter and actually build something pretty powerful in a very short period of time.

Absolutely. On I wanted before we dive in to create fire and touch on your hashtag long L. A onda talk about the rise of the L A ecosystem. Why we've seen it, how it is being there now and then What? Your petitions off the road map?

Yeah, I'm obviously very bullish on L. A. And it put my career on it, and I think it stems from an element that I think, you know, the most creative people in the world live in Los Angeles 20 years ago, we thought about that from, ah, Hollywood perspective. But now I think we think about it from not just Hollywood entertainment Allah content, but I think about it from arts. I think about it from food. I think about it from diversity, I think about from weather and global proximity and the unique thing about L. A. With that creativity component.

Is it really with the core application layer being built? I love the technology to make the Internet and mobile go is content, community commerce, communication can all be built on top of that. And I think l a in particular is very good at doing that. So look at companies like Snapchat, obviously, which I think is one of the most exciting companies globally. Right now you have space X. You have tinder, you have honest company commerce, other comers. Companies like Luke rates that. I think we're doing very interesting things in L. A. This kind of fits perfectly for those elements coming

together. So for an emergent community like L. A. What's first, then? Is it the investors? Or is it the high quality star subs?

I believe that you know there's plenty of capital out there locally, nationally and globally, and they're starving for great ideas and great entrepreneurs building great businesses, so the capital will find the great businesses. And you could just look at L. A. There are very few top 50 venture fund that don't have an investment in Southern California today. Some of the top investors with historically, whether it's Kleiner Perkins or whether its benchmark or Sequoia they all have multiple Los Angeles based companies in their portfolios. Eso I don't think I think the capital will find the great businesses. I think we're just now getting the great entrepreneurs who may be doing things in different categories. Are market segments to think about technology related businesses in Southern California.

And then I want to dive into a quick fire round now. So I said, Sure, game, Yeah, So your favorite book and

why I tend brought a movement broader. So I'm a big Michael Lewis fan on DSO. I think, obviously, like Moneyball, blindside liars, poker. That kind of that thought provoking type of work that he does around actual real topics are the type of literature and books that I respond

to. What's the morning routine fee? Is there any ritual preparation?

Maybe the night before? Yeah, it's pretty boring, but the reality is I'm getting old. S o I wake up about six o'clock. I probably read for 30 to 45 minutes. Think current events, technology news, politics, sports those seven things. And I spent probably another half hour just before the kids were getting up, really getting caught up with the email, a candidly dealing with the top priorities that probably kept me up from the night before on DSO. That way, when I get to work after I drop my kids about 8 30 45 I feel like I'm not behind. So really, those 60 to 90 minutes, my wake up kind of get me set for

the day. And then what online brand have you been most impressed with in recent years?

Yes, So I talked about Dollar Shave Club, which is an example of an L A company before, but I think what Michael has done around building a brand organically in a very fun and innovative way, starting with that great video and then most recently, is television commercials and new product launches and everything in between. I love brands that are really disrupting the legacy provider. So in Los Angeles, for example, we have another company called Honest Company that's done a very good job building brand. They're both attacking the same company, which is Procter and Gamble, and you can see them responding by doing what big companies do suit, you know, creating grassroots quote unquote grassroots marketing efforts challenging the claims of these innovative brands. You see them actually trying to do their own scientific research about the quality of the products. You see this disparagement of these brands, and so I think you know, your you know it's working when that's where the legacy providers react. So I think those were a couple examples of very special brands that are under my backyard that I'm very proud

of on. Then what's your favorite tack and start up and investing blocks or news lessons? There, any must read to you.

Yes, Dan Prime Max terms she, which comes about seven my time here in California. It's it's definitely must read if it's part of my 30 to 45 minute routine to really know what's going on in my business. He does a great job and always has unique perspectives. It's definitely a must read for me,

and then the most problem moment, if

you will crack. Yeah, I thought about that question because for the users out there, we know some of the questions that are being asked, Harry. But I haven't been very good at celebrating my own successes, and I think that's part of what it makes. Really motivates Ford of all the things that from a work perspective, obviously getting hired at eBay in 2003 really set everything off. For me, that's worry. I did good work. I made an impact. I met great people and really understood what I went, motivated me and starts to say. That's probably been the most proud will, when I have looking back At the time, I probably didn't realize it, but now I contrite trace almost all of my successes over the past 10 to 12 years. Pretend to 15 years, really from that 2003 hiring

a bay on, then finally your most recent public investment and why you said yes,

yes, So I invested in a company called Happy Returns, which we talked a little bit about friction and retail. But returns is broken, so think of you buy something on did you don't want it online retailers Aaron a disadvantage because of the fact that they don't have stores to return product to. You'd probably be surprised to know that most of the top retailers in the U. S. All ah Macy's and Nordstrom the Gap, etcetera almost 70% of the product that's bought online and returned from the stores actually returned into the stores. It's a big part of the true omnichannel experience, and most online retailers don't have that advantage. So Happy Returns really creates the ability for online retailers to offer offline return solutions on DSO. It's a business that I have a long relation with the founder. It's right in my wheelhouse and from a retail innovation perspective. And I think it's kind of an unknown, really an unknown problem from most onto other entrepreneurs and even investors. So it's one of those businesses that I'm super excited about.

Well, Greg has been an absolute pleasure having you on the show say thank you so much for joining

me. Absolutely, absolutely glad to be here.

What a fantastic absolute that was with Dragon so grateful to him for giving up his time, stay to appear on the show and if you enjoyed the absolute stay. You can follow me on Snapchat at H stabbings with two B's or you can sign up for the newsletter on the 20 minute v c dot com. That's all in letters, so you never have to miss an absolute or an update from us. Also, do not forget to check out. We are L. A tech from my good friend Esprit, who runs the show. We Are Latex again is the number one resource uniting the L. A start up community they offer a unique combination of curated offline experience is the number one l Attack. Pork Rascal. We are Attack one of my favorites on the only mobile app that keeps you in the know with a full calendar events, so make sure to go to we are all attack dot com ford slash v c To explore and learn all about everything. L Attack and Silicon Beach from the homes of the lifes of Snapchat. You'll also get access to a private L attack immersion cool exclusively for 20 minute BC listeners again,

that's we are latex dot com, four slash v C. U must check it out. I'm with the week ahead. Remember, every great day starts the night before. Every smart move you make on Wednesday has its roots in Tuesday. So leap out of bed with a can do attitude and you've got a head start on the world on. That's why IV makes only one kind of mattress the very best. With three letter next generation memory foam and open cell technology, they even give you a 100 night trial to make sure that the match is perfect for you with free return. Pick up. So go to Eve, mattress dot co dot UK and to the code 20 V C for £50 off and will be with you the next day with next day delivery. Everybody deserves a perfect start with Eve. As always,

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